Dan Balz's Take

When a Hillraiser Brings More Than Just Money

The Clintons, plus Ted Danson and Mary Steenburgen, at a Martha's Vineyard fundraiser this month. (AP).

One week after John Edwards uttered the words "Lincoln Bedroom," Hillary Clinton's campaign finds itself with another fundraising embarrassment on its hands.

The saga of businessman Norman Hsu has come in three quick stages: a Wall Street Journal story raising questions about his bundling practices: a Los Angeles Times story revealing that there is a pending arrest warrant for him in California stemming from a 1991 fraud case; an announcement by Clinton's campaign that she will donate to charity $23,000 in contributions she has received from Hsu over the years.

Perhaps that will be the end of things, but that would be an optimistic scenario from the vantage point of Clinton's campaign. Instead, the danger is that the latest fundraising discomfiture becomes one more opportunity for Clinton's opponents to stir up other unhappy memories of her husband's tenure in the White House.

The Clinton camp moved quickly, as it generally has this year, to push the story into the background. An announcement this morning of an endorsement by the International Association of Machinists and Aerospace Workers provided a positive counter-story for the campaign to promote.

But there are lingering issues that already have become targets for other campaigns. The most significant is whether Clinton will also give back the money that the enterprising Hsu helped to round up from others. The Post's Matthew Mosk reported last night that Clinton has received about $96,000 from people associated with Hsu for her various political committees since 2004.

Clinton addressed the issue today during an interview with O. Kay Henderson, news director of Radio Iowa. "Well everyone was obviously surprised to learn this news and my campaign has taken action in returning his contributions and I'm hopeful he will be taking steps to address the matters he faces," she said. " We regularly review contributions as we receive them and will continue to do so and if we have any reason to return any contributions, we will do that."

Another issue is whether there are other fundraising problems buried in the tens of millions raised by the Clinton campaign. Given the intensity of the fundraising competition between Clinton and Barack Obama, and reports from some Democrats that the network of potential Clinton contributors may be limited, the potential for abuse by people outside the campaign's direct control exists.

Beyond that, however, is the question raised directly by Edwards when he summoned up memories of the Lincoln Bedroom in his New Hampshire speech on Aug. 22.

"The choice for our party could not be more clear," he said. "We cannot replace a group of corporate Republicans with a group of corporate Democrats, just swapping the Washington insiders of one party for the Washington insiders of the other. The American people deserve to know that their presidency is not for sale, the Lincoln Bedroom is not for rent, and lobbyist money can no longer influence policy in the House or the Senate."

Without mentioning Clinton by name, Edwards rolled together the argument that he will be making more and more explicit in the coming months: that Clinton is a risky choice for Democrats in an election cycle in which growing dissatisfaction with business as usual in Washington is a central theme.

Howard Wolfson, the Clinton campaign's communications director, said in a message today that the New York senator's campaign worries little about damage to her candidacy from things that happened a decade or more ago. "Voters haven't just turned the page on that, they've closed the book," he said.

That is a view long espoused by the campaign's chief strategist, Mark Penn, who has argued from the first day of Clinton's candidacy that the past is not prelude for Clinton, particularly any of the scandals of the past.

But Obama has suggested otherwise. In a recent interview with the Post, he said the Democratic front-runner carries baggage that may not be easily shed. "Some of those battles in the '90s that she went through were the result of some pretty unfair attacks on the Clintons," he said. "But that history exists."

Obama was not referring to any specific scandal, fundraising or otherwise, during the Clinton presidency -- just offering a calculated observation that he clearly wants to make part of the choice for Democratic voters in the coming months.

Both he and Edwards believe they have found a vulnerability in Clinton's staunch defense of lobbyists and the money she accepts from them, which she articulated at the YearlyKos candidate forum before an audience of bloggers. Anything that helps publicize the unsavory aspects of either fundraising or the connection between lobbyists and politicians -- as the Hsu story does -- will be fodder for Clinton's rivals, directly or indirectly.

At this point, Clinton remains on solid ground with Democratic voters. She leads national polls, she has improved her standing in Iowa, she is seen in highly favorable terms by those voters, and she has been running what even her opponents concede has been a largely mistake-free campaign. Beyond that, Bill Clinton remains even more popular among Democratic voters.

In a few days or weeks, Norman Hsu may have faded completely from political consciousness. That is certainly the hope and belief of the Clinton campaign. But the issue of what another Clinton presidency would mean for the Democratic Party and the country is not likely to fade so quickly.

The candidate has ably articulated why it could be positive, in debates and on the campaign trail. But the issue continues to linger and Clinton's opponents have signaled that they are going to do what they can to make the it even more prominent as the campaign intensifies.

Comments

The HillBillys have become masters at cozying with convicted felons, fugitives and pandering to China and India with US technology and military knowhow. In return for the money these felons bring to their campaign, the HillBillys give them a "good for a presidential pardon" coupon. Bill collected more than 41 million dollars from Americans for attending his speeches just because he is an ex-president. It is all about money for these Clinton's. Who benefits if the Clinton's get into the white house again? The Chinese, the Indians, and any other country who has pumped money into the Clinton campaigns. With regard to the HillRaiser club, how difficult is to ask the following question when somebody says they want membership in the fundraising club: "Do you have any pending warrants against you?" Well if they ask that question, the size of the HillRaiser club will be probably half of what it is now.

Posted by: free_and_easy | September 11, 2007 7:03 PM

In playing ball the Hillary way Hsu's on second, Trie's gone home and now it's time for the Paws that refreshes. She fouls once again.

Posted by: ardysrp | September 2, 2007 7:27 PM

It's funny how the mainstream media have virtually blacked-out this story in favor of running endless stories on Senator Craig's bathroom sex scandal. Yes, Craig should resign; however, nobody on the major networks seems to care about Hillary or other prominent Democrats taking money from a crook. And Hillary's claim that she can't keep up with every person who gives to her campaign is bunk! She can't keep up with the little givers, but those like Hsu she knows very well! They are even pictured together smiling real big! Come on Post, NY Times, CBS, NBC & others. Cover this story like Craig's. It's a scandal too!

Posted by: denves | September 1, 2007 8:54 AM

I agree with gary, too. Why, oh why would Democrats nominate her after what the Clintons put the Democratic party through in the 90's.

I mostly hope that Democrats come to their senses but if she is the nominee, I hope to see a repeat of 1988 when Ted Koppel confronted Dukakis with the impossibility of winning in September. It would be good for the Clintons to be put through 2 months of hopelessness and then the Democratic Party might be cured of the Clinton cancer.

Posted by: Malia2 | August 31, 2007 10:23 PM

I agree with garyczegan. Hillary has brand name recognition and thats whay she leads in the national polls. She really has no substance. She is a seasoned politician who has been preparing for this since Bill left the White House. I cant and wont convince people who are ignorant to the facts. Bottom line is that I would never trust Hillary or any other Clinton. I dont trust Chelsea and I dont even know her. A lot can be said about a woman who has been cheated on multiple times and stays with the same man. STRONG WOMAN MY BUTT! How could she run the country when she cant even keep Bill's pants up?

Posted by: dsansone | August 31, 2007 9:43 AM

Hey Audart you mentioned Obama being a rookie, name one piece of legislation Hillary has sponsored in the 6 years of being Senator of New York? You can't and won't be able to answer because she has accomplished "0"!

Dream on if you think she will be elected when she has a 50% unfavorable rating by voters who vowed never to vote for her. This is the highest unfavorable rating of any candidate running for President, ever!!She is a crook just like her sexual predator husband so support her you loser!!!

Posted by: garyczegan | August 31, 2007 9:17 AM

The animosity directed at Hillary by her haters will only increase as Hillary continues to lead all candidates in the polls. Hillary is ready for it. It will not faze her in the least. And those who love and support her won't be convinced to switch to Obama the rookie or Edwards the hypocrite with the big-mouthed wife.

Hillary has been a stellar candidate. This is the real problem her haters are having. They predicted Hillary's candidacy would pretty much be over by now.

We have news for the haters:

Hillary will be our next President.

Posted by: audart | August 31, 2007 9:02 AM

Hey Mamsterdam you want to see some facts that support that the Clinton's Are a syndicted crime family read below and remember we have the facts and their words and we can't wait until you idiots nominate her because it will be the second coming of Reagan Dukakis!!!

Under the listing of "Records Set'" by the Clinton administration (read: co-presidency), Progressive Review cites the following, of which I will only list a sampling:

â–ª Most number of convictions and guilty pleas by friends and associates.

â–ª Most number of cabinet officials to come under criminal investigation.

â–ª Most number of witnesses to flee country or refuse to testify.

â–ª Most number of witnesses to die suddenly.

â–ª First president sued for sexual harassment.

â–ª First president accused of rape.

â–ª First president to be held in contempt of court.

â–ª First president to be impeached for personal malfeasance.

â–ª First first lady to come under criminal investigation.

â–ª Largest criminâ–ªal plea agreement in an illegal campaign-contribution case.

Greatest amount of illegal campaign contributions.

â–ª Number of Starr-Ray investigation convictions or guilty pleas to date: one governor, one associate attorney general and two Clinton business partners: 14.

â–ª Number of Cabinet members who came under criminal investigation: 5.

â–ª Number of individuals and businesses associated with the Clinton machine that were convicted of or pleaded guilty to crimes: 47.

â–ª Number of these convictions during Clinton's presidency: 33.

â–ª Number of indictments/misdemeanor charges: 61.

â–ª Number of congressional witnesses who pleaded the Fifth Amendment, fled the country to avoid testifying, or (in the case of foreign witnesses) refused to be interviewed: 122.

The Washington Post focuses on the $23,000 that Hsu has contributed to Hillery Clinton's campaigns but ignores the greater sums he gave to other Democrats. For example, Hsu gave $62,000 to Gov. Elliot Spitzer and $100,000 to the New School headed by former Senator Bob Kerry. Please try to take a broader view of this guy's activities. Don't try to pin him on Hillary. The evidence doesn't support it.

Posted by: ramster1 | August 30, 2007 11:01 PM

Hey Democrat's We In the Republican party and the 50% of American's who vowed they will never vote for Hillary are counting the days when you idiots nominate her this is going to be so much fun.

Can you democrats name one piece of legislation that Hillary has sponsored in the 6 years of being Senator of New York? Once a Clinto always a Clinton the Clinton crime family is at it again!!

Hillary Fundraiser Eludes Jail for 15 Years

This is one of those stories that could only happen to a Clinton.

Norman Hsu, a prominent Democratic fundraiser who has funnelled hundreds of thousands of dollars into Hillary Clinton's Senate campaigns and pledged to raise $100,000 for her presidential bid has been a fugitive from justice for 15 years.

In 1992, he pleaded no contest to charges of grand theft and agreed to serve three years in jail. But something funny happened on the way to prison; he never showed up:

He is a fugitive," Ronald Smetana, who handled the case for the state attorney general, said in an interview. "Do you know where he is?"

Hsu, it seems, has been hiding in plain sight, at least for the last three years.

Since 2004, one Norman Hsu has been carving out a prominent place of honor among Democratic fundraisers. He has funneled hundreds of thousands of dollars in campaign contributions into party coffers, much of it earmarked for presidential hopeful Sen. Hillary Rodham Clinton of New York.

In addition to making his own contributions, Hsu has honed the practice of assembling packets of checks from contributors who bear little resemblance to the usual Democratic deep pockets: A self-described apparel executive with a variety of business interests, Hsu has focused on delivering hefty contributions from citizens who live modest lives and are neophytes in the world of campaign giving.

It gets better. Apparently, Mr. Hsu "forgot" that he is a convicted felon:

On Tuesday, E. Lawrence Barcella Jr. -- a Washington lawyer who represents the Democratic fundraiser -- confirmed that Hsu was the same man who was involved in the California case. Barcella said his client did not remember pleading to a criminal charge and facing the prospect of jail time. Hsu remembers the episode as part of a settlement with creditors when he also went through bankruptcy, Barcella said.

The Wall Street Journal has some interesting facts about Hsu and his donors:

Yesterday, The Wall Street Journal reported that a modest home in a middle-class San Francisco suburb, where the family of mail carrier William Paw resides, is listed as the address for many contributions to the Clinton campaign. Mr. Hsu once listed the home as his address, according to public records, and the Paws' donations closely tracked his.

Does Hsu skirt FEC laws by reimbursing donors and then trying to hide the evidence? Certainly worth looking into don't you think?

In typical Clinton fashion, the best defense is a good offense. When in doubt, deny, deny, deny:

"Norman Hsu is a longtime and generous supporter of the Democratic Party and its candidates, including Sen. Clinton," Howard Wolfson, a spokesman for the campaign, said Tuesday. "During Mr. Hsu's many years of active participation in the political process, there has been no question about his integrity or his commitment to playing by the rules, and we have absolutely no reason to call his contributions into question or to return them."

Which only goes to show that the more things change for the Clintons, the more they stay the same.

Posted by: garyczegan | August 30, 2007 10:53 PM

How can she not have known...where was the secret service? Don't they do background checks on people who are close to the people they protect? Did they not do their job?

I don't believe that she didn't know...they wanted the money.

Posted by: dsmith2 | August 30, 2007 5:13 PM

Do I infer correctly that you think this will dog HRC's candidacy from here on?

Posted by: mark_in_austin | August 30, 2007 5:07 PM

It is worth mentioning that it is not just Bill Clinton who has fundraising problems in his past, Hillary's Senate campaign ran into some pretty major trouble. Her campaign filed false reports with the Federal Elections Commission in 2000 that omitted about $2.2 million in donations from a guy named Peter Paul who is now suing them.

David Rosen, her campaign finance director, was indicted for making false statements although he was ultimately acquitted. However, her campaign was fined $35,000 when the FEC determined that there was probable cause to believe that her treasurer Andrew Grossman had knowingly filed false reports.

The other side of the coin is going to be the $41 million in speaking fees that Bill Clinton was paid in front of interest groups that have business before the Senate. Senate rules prohibit Senators from accepting such honoraria, but are lax about spouses accepting the same. Some of Bill's employers are rather interesting people, such as the "Committee for the peaceful reunification of Taiwain" (an obvious Chinese front group), a Turkish industrial association, and $800,000 from a shadowy Columbian "development group" known as "Gold Services International."

Since these payments are the Clinton's own money they can use them just as easily (if not more) than campaign contributions. Instead of being limited to $4,000 these contributors pay Bill $150,000 to $400,000 per speech.

Posted by: George14 | August 30, 2007 5:00 PM

You failed to mention that Hsu has endorsed Clinton and not Obama. Apparently Clinton is trying to get her "DIRTY" fundraisers to donate to Obama's campaign in order to try and dirty his campaign. Hsu is Clintons scandal...not Obama's.

Posted by: vamonticello | August 30, 2007 4:25 PM

Missing from your report are the names of the other Democrats who received contributions from Hsu, including Kerry, Boxer, Kennedy, and Feinstein.

Further, the fact that Obama received money from Paw, and has chosen not to return or donate those funds are also omitted.